UPSC 2016EconomyModerate

What is/are the purpose/purposes of the 'Marginal Cost of Funds based Lending Rate (MCLR)' announced by RBI? 1. These guidelines help improve the transparency in the methodology followed by banks for determining the interest rates on advances. 2. These guidelines help ensure availability of bank credit at interest rates which are fair to the borrowers as well as the banks. Select the correct answer using the code given below.

a
1 only
b
2 only
c
Both 1 and 2
d
Neither 1 nor 2
Monetary PolicyInterest Rate MechanismsMarginal Cost of Funds based Lending Rate (MCLR)RBItransparencyinterest ratesadvancesbank creditfair ratesborrowersbanks

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